Question

Two important prerequisites for long run growth in output per worker are increasing birth rates and...

  1. Two important prerequisites for long run growth in output per worker are

    increasing birth rates and falling death rates

    saving and investment

    fiscal and monetary policies

    consumption and investment
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Answer #1

Option d is correct. Consumption and investment are the two important prerequisites for long run growth in output per worker.

As consumption and investment rises, aggregate demand for good and services will increase. It will induce firms to increase their production level. As production rises, labor demand will increase by firms. It will increase the labor wages. As a result labor supply will increase. It will increase output per worker in long run

All other options are wrong. Increasing birth rates and falling death rates, or saving and investment are not the important factors promote long run growth rate of output

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